Thinking of starting Business.. Income Tax?

[NY detailer]

Originally posted by Aurora40
Just my $.02...

I would report your income. I think if you make under about $6,000, then you'll have no real taxes due. I don't <i>think</i> you need to charge sales tax for self-employed services, but I'm not sure on that. Maybe it depends on how much you'll be selling. Sales tax is usually only on goods. Detailing isn't a good.

I charge 8.25% tax on every detail job. NYS makes me collect it for them. I tell all my customers I do not charge sales tax, I only collect it.

If you dont charge tax thats up to you guys, but the worst thing you can do is charge tax and not pay it to the IRS.
You need to way your options & risk just like anything else

[eduhilera]

He is 16 years old trying to make a little bit of cash on the side... Look back to when ya'll were 16 and then tell me that you were paying taxes back then for washing your neighbors cars... Didn't Think So... And its no a little guy who is making a little bit of money who affects the economy its all the big fish that dont pay their taxes either so then who is he really gonna affect? Im sure the government wont send an auditor to investigate a boy's car washing business...

[ryeh2o]

The one thing that kids are not taught in our schools today is how to deal with money in the real world.

I agree completely with DavidB about using this Business opportunity to the fullest. There are lots of realities to business, sales, receivables, expenses, taxes, future growth, etc.

You have a chance in a micro way, to get exposure to all these.

Working for yourself in which ever field you choose, will afford you the most opportunities in life.

Good luck, and have fun!

[Aurora40]

Originally posted by NY detailer
I charge 8.25% tax on every detail job. NYS makes me collect it for them. I tell all my customers I do not charge sales tax, I only collect it.

If you dont charge tax thats up to you guys, but the worst thing you can do is charge tax and not pay it to the IRS.
You need to way your options & risk just like anything else

That may depend on the state, though. If I go get an alignment on my car, I don't pay sales tax. They didn't sell me any goods. But if I bought some parts from the shop, they'd charge a tax. I don't know that every state has a tax on services.

[denzo]

Originally posted by DavidB
If you start saving $100 per month at age 18, you can easily build an investment worth $1,000,000 or more by the age of 40. Think about it. You can't replace time... grab it while you're young!

Not to down-play the general message about investing, but technically you would have to be earning an interest rate of more than 24.43% in order to achieve that kind of future value on a $100/month investment. Unless you're doing risky stock market day-trading, it'll be hard to get a rate like that.

If you earn 5%, it would be $48,000. If you earn 10%, it would be $95,000. Still a nice chunk of cash to supplement your retirement with, though. And it always pays to start investing as early as possible. If you started investing twice as much, $200/month at age 30, you would only end up with $31,000 at 5% or $41,000 at 10% by the time you were 40. Money is more valuable the earlier you can invest it.